SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549


                                    Form 10-Q


                   Quarterly Report under Section 13 or 15 (d)
                     of the Securities Exchange Act of 1934


               For the quarterly period ended:  September 30, 1999
                                                ------------------

                        Commission File Number: 0-19589
                                                -------



                              ARGUSS HOLDINGS, INC.
           ----------------------------------------------------------
             (Exact name of Registrant as specified in its Charter)


           Delaware                                        02-0413153
-------------------------------                  -------------------------------
(State or other jurisdiction of                         (I.R.S. Employer
incorporation of organization)                        Identification Number)


One Church Street, Suite 302, Rockville, Maryland             20850
-------------------------------------------------       -----------------
    (Address of Principal Executive Offices)                (Zip Code)


Registrant's Telephone Number, including Area Code:       301-315-0027




Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.


  Yes:   X             No:
       -----               -----



As of November 9, 1999, there were 12,668,513  shares of Common Stock, $ .01 par
value per share, outstanding.



<PAGE>


                              ARGUSS HOLDINGS, INC.


                                      INDEX




Part I - Financial Information:                                             Page
                                                                            ----

     Item 1 - Financial Statements


          Consolidated Balance Sheets (Unaudited)-
          September 30, 1999 and December 31, 1998                            3

          Consolidated Statements of Operations (Unaudited)-
          Three Months and Nine Months Ended September 30, 1999
           and September 30, 1998                                             4

          Consolidated Statements of Cash Flows (Unaudited)-
          Nine Months Ended September 30, 1999 and September
           30, 1998                                                           5

          Notes to Consolidated Financial Statements
          (Unaudited)                                                         7


     Item 2 - Management's Discussion and Analysis of Financial
              Condition and Results of Operations                            13

     Item 3 - Quantitative and Qualitative Disclosures about Market Risk     18

Part II - Other Information                                                  19

     Items 1 through 6

     Signatures

     Exhibits





                                       2
<PAGE>


                              ARGUSS HOLDINGS, INC.

                           CONSOLIDATED BALANCE SHEETS
                                   (UNAUDITED)


                                                   Sept. 30, 1999  Dec. 31, 1998
                                                   --------------  -------------
Assets

Current assets:
Cash                                                $  3,678,000    $  1,819,000
Restricted cash from customer advances                 2,906,000         978,000
Accounts receivable trade, net of allowance
  for doubtful accounts of $311,000 and
  $265,000 in 1999 and 1998, respectively             37,496,000      35,263,000
Costs and earnings in excess of billings              16,201,000       2,339,000
Inventories                                            4,149,000       5,657,000
Other current assets                                   1,825,000       1,399,000
Deferred tax assets                                    1,844,000       1,844,000
                                                    ------------    ------------
  Total current assets                                68,099,000      50,047,000

Property, plant and equipment, net                    36,945,000      31,147,000
Goodwill, net                                         95,486,000      71,728,000
                                                    ------------    ------------
                                                    $200,530,000    $152,922,000
                                                    ============    ============

Liabilities and Stockholders' Equity

Current liabilities:
Current portion of long-term debt                   $  7,315,000    $ 11,429,000
Short-term borrowings                                 27,070,000       8,038,000
Accounts payable                                      17,032,000      13,798,000
Billings in excess of costs and earnings                    --           748,000
Customer advances                                      2,391,000       1,380,000
Accrued expenses and other liabilities                13,429,000       7,098,000
Due to former shareholders of acquired companies      11,745,000      18,696,000
                                                    ------------    ------------
  Total current liabilities                           78,982,000      61,187,000
                                                    ------------    ------------

Long-term debt, excluding current portion             21,202,000      23,187,000
Deferred income taxes                                  3,510,000       3,675,000
                                                    ------------    ------------
  Total liabilities                                  103,694,000      88,049,000
                                                    ------------    ------------

Stockholders' equity:
Common stock $.01 par value                              119,000         109,000
Additional paid-in capital                            77,346,000      61,327,000
Common stock issuable to former USI shareholders      10,909,000            --
Retained earnings                                      8,462,000       3,437,000
                                                    ------------    ------------
  Total stockholders' equity                          96,836,000      64,873,000
                                                    ------------    ------------
                                                    $200,530,000    $152,922,000
                                                    ============    ============


The accompanying notes are an integral part of these financial statements.



                                       3
<PAGE>


                              ARGUSS HOLDINGS, INC.

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)
<TABLE>
<CAPTION>
                                                     Three Months Ended                Nine Months Ended
                                              Sept. 30, 1999  Sept. 30, 1998   Sept. 30, 1999   Sept. 30, 1998
                                              --------------  --------------   --------------   --------------

<S>                                            <C>             <C>             <C>              <C>
Net sales                                      $ 53,351,000    $ 45,908,000    $ 142,965,000    $ 104,741,000
Cost of sales, excluding depreciation            39,642,000      34,543,000      107,456,000       78,578,000
                                               ------------    ------------    -------------    -------------
    Gross profit, excluding depreciation         13,709,000      11,365,000       35,509,000       26,163,000

Selling, general and administrative expenses      3,904,000       3,889,000       11,990,000       11,247,000
Depreciation                                      2,195,000       1,668,000        6,218,000        4,463,000
Goodwill amortization                             1,208,000         687,000        3,212,000        1,992,000
Engineering and development                         322,000         362,000        1,006,000          905,000
                                               ------------    ------------    -------------    -------------
    Operating income                              6,080,000       4,759,000       13,083,000        7,556,000
                                               ------------    ------------    -------------    -------------

Other income (expense):
    Interest income and other                       186,000         136,000          380,000          312,000
    Interest expense                             (1,113,000)       (827,000)      (3,168,000)      (2,275,000)
                                               ------------    ------------    -------------    -------------

Income before taxes and reversal of
  accrued loss on disposition of
  discontinued operation                          5,153,000       4,068,000       10,295,000        5,593,000

Income tax expense                               (2,483,000)     (1,902,000)      (5,267,000)      (3,034,000)
                                               ------------    ------------    -------------    -------------

Income before reversal of
  accrued loss on disposition of
  discontinued operation                          2,670,000       2,166,000        5,028,000        2,559,000
                                               ------------    ------------    -------------    -------------

Reversal of accrued loss on disposition
  of discontinued operation,
  net of  tax expense                               182,000            --               --               --
                                               ------------    ------------    -------------    -------------

Net income                                     $  2,852,000    $  2,166,000    $   5,028,000    $   2,559,000
                                               ============    ============    =============    =============


Earnings per common share:
               - basic                                $ .24           $ .20            $ .43            $ .24
                                                      =====           =====            =====            =====
               - diluted                              $ .22           $ .18            $ .39            $ .23
                                                      =====           =====            =====            =====

Weighted average shares outstanding:
               - basic                           11,889,000      10,697,000       11,798,000       10,493,000
                                               ============    ============    =============    =============
               - diluted                         13,169,000      12,068,000       12,935,000       11,359,000
                                               ============    ============    =============    =============
</TABLE>

The accompanying notes are an integral part of these financial statements.




                                       4
<PAGE>


                              ARGUSS HOLDINGS, INC.

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                            Nine Months Ended
                                                     Sept. 30, 1999  Sept. 30, 1998
                                                     --------------  --------------
<S>                                                   <C>             <C>
Cash flows from operating activities:
    Net income                                        $  5,028,000    $  2,559,000

Adjustments to reconcile net income to net
  cash provided by (used in) operating
  activities:
    Depreciation                                         6,218,000       4,470,000
    Goodwill amortization                                3,212,000       1,992,000
    Non cash stock compensation                               --         1,847,000

Changes in assets and liabilities:
    Accounts receivable                                   (994,000)    (18,387,000)
    Costs and earnings in excess of billings           (13,630,000)     (7,934,000)
    Inventories                                          1,508,000        (122,000)
    Other current assets                                  (367,000)        996,000
    Accounts payable                                     2,886,000       7,763,000
    Billings in excess of costs and earnings              (748,000)           --
    Accrued expenses and other liabilities               6,166,000       5,318,000
                                                      ------------    ------------
      Net cash flows provided by (used in)
        operating activities                             9,279,000      (1,498,000)
                                                      ------------    ------------

Cash flows from investing activities:
    Additions to property, plant and equipment         (11,224,000)    (10,619,000)
    Additional payment to former Schenck
      shareholders                                      (7,604,000)           --
    Purchase of telecom construction companies, net     (2,517,000)    (17,441,000)
                                                      ------------    ------------
      Net cash used in investing activities            (21,345,000)    (28,060,000)
                                                      ------------    ------------

Cash flows from financing activities:
    Proceeds from lines of credit                       19,709,000      33,015,000
    Net repayments of lines of credit                   (6,887,000)     (4,000,000)
    Issuance of common stock                             1,103,000         921,000
                                                      ------------    ------------
      Net cash provided by financing activities         13,925,000      29,936,000
                                                      ------------    ------------

      Net increase in cash                               1,859,000         378,000
                                                      ------------    ------------

      Cash at beginning of period                        1,819,000       1,215,000
                                                      ------------    ------------


      Cash at end of period                           $  3,678,000    $  1,593,000
                                                      ============    ============
</TABLE>



                                       5
<PAGE>


                              ARGUSS HOLDINGS, INC.
                                  CONSOLIDATED
                      STATEMENTS OF CASH FLOWS (CONTINUED)


                                                         Nine Months Ended
                                                 Sept. 30, 1999   Sept. 30, 1998
                                                 --------------   --------------

Supplemental disclosures of cash paid for:
Interest                                           $ 2,774,000     $  2,275,000
Corporate income taxes                               1,687,000          923,000

Supplemental disclosure of
  investing and financing activities:

Fair value of assets acquired:

Accounts receivable                                $ 1,154,000     $  9,513,000
Other current assets                                    52,000          491,000
Property and equipment                                 792,000        7,546,000
                                                   -----------     ------------
    Total non cash assets                            1,998,000       17,550,000

Liabilities                                           (350,000)      (6,437,000)
Long-term debt                                        (111,000)      (2,455,000)
                                                   -----------     ------------

Net non cash assets acquired                         1,537,000        8,658,000

Cash acquired                                             --          1,725,000
                                                   -----------     ------------

Fair value of net assets acquired                    1,537,000       10,383,000

Excess of costs over fair value
  of net assets acquired                             3,017,000       31,332,000
                                                   -----------     ------------

Purchase price                                     $ 4,554,000     $ 41,715,000
                                                   ===========     ============

Common stock issued                                $ 2,037,000     $ 24,274,000
Cash paid                                            2,517,000       19,166,000
Cash acquired                                             --         (1,725,000)
                                                   -----------     ------------

Purchase price                                     $ 4,554,000     $ 41,715,000
                                                   ===========     ============


NOTE:   During  the  nine  months  ended  September  30,  1999,  former  Schenck
shareholders  received an additional  $7.6 million in cash and 777,000 shares of
the Company's common stock in full satisfaction of their additional payments. In
November  1999,  former  Underground  Specialties  shareholders  will receive an
additional  $11.7 million in cash and 758,000  shares of the Company's  stock in
full satisfaction of their additional payments.


The  accompanying  notes are an integral  part of these  consolidated  financial
statements.



                                       6
<PAGE>


                              ARGUSS HOLDINGS, INC.
                              NOTES TO CONSOLIDATED
                              FINANCIAL STATEMENTS
                                   (UNAUDITED)


     A)   ORGANIZATION

     Prior to May 1997,  Arguss  Holdings,  Inc. (the  "Company")  operated as a
single entity under the name Conceptronic, Inc. On May 9, 1997, the shareholders
of the Company  approved a plan providing for the internal  restructuring of the
Company  whereby the Company became a holding  company and its operating  assets
were held by wholly owned operating subsidiaries.  Accordingly,  on May 9, 1997,
the Company  transferred  substantially all of its Conceptronic,  Inc. operating
assets to a newly  formed,  wholly  owned  subsidiary  of the  Company,  and the
Company changed its name to "Arguss Holdings,  Inc." The subsidiary then adopted
the name "Conceptronic, Inc." ("Conceptronic"). The Company's other wholly owned
operating  subsidiary  is Arguss  Communications  Group,  Inc.,  formerly  White
Mountain Cable Construction Corp.

     The Company conducts its operations through its wholly owned  subsidiaries,
Arguss  Communications  Group and Conceptronic.  Arguss  Communications Group is
engaged in the construction,  reconstruction,  maintenance, repair and expansion
of  telecommunications  systems,  cable  television and data systems,  including
providing  aerial and underground  construction and splicing of both fiber optic
and coaxial cable to major telecommunications  customers.  Arguss Communications
Group operates through its divisions - White Mountain, Can-Am, TCS, Schenck, and
Underground  Specialties.  Conceptronic  manufactures and sells highly advanced,
computer-controlled equipment used in the SMT circuit assembly industry.

     During the quarter  ended  September 30, 1999,  plans to sell  Conceptronic
were terminated.  The Company's  decision not to sell the division was based, in
part, on improved order flow, completion of a new oven design, and the hiring of
a new  President.  Consequently,  Conceptronic  was  reinstated  as a continuing
operation.  Because the Company  believes  there has been no  impairment  on the
carrying  value of the net assets of  Conceptronic,  the  estimated  loss on the
disposal of  discontinued  operations was reversed.  The reversal of the accrued
loss on the disposal of  discontinued  operations  during the three months ended
September  30, 1999 was $182,000,  or $.01 per share.  Segment  information  for
Conceptronic is presented in Note G.

     B)   BASIS FOR PRESENTATION

     As permitted by the rules of the  Securities and Exchange  Commission  (the
"Commission")  applicable  to  quarterly  reports on Form 10-Q,  these notes are
condensed  and do not contain all  disclosures  required by  generally  accepted
accounting principles.  Reference should be made to the financial statements and
related notes included in the Company's  Annual Report on Form 10-K for the year
ended December 31, 1998, filed with the Commission on March 16, 1999.

     In the  opinion  of  the  Company,  the  accompanying  unaudited  financial
statements  contain all adjustments  considered  necessary to present fairly the
financial  position of the Company as of  September  30, 1999 and the results of
operations and cash flows for the periods  presented.  The Company  prepares its
interim financial  information  using the same accounting  principles as it does
for its annual financial statements.

     The  Company's  telecom  construction   operations  are  expected  to  have
seasonally  weaker results in the first and fourth quarters of the year, and may
produce stronger  results in the second and third quarters.  This seasonality is
primarily due to the effect of winter weather on outside plant activities in the
northern  areas  served  by  Arguss  Communications  Group,  as well as  reduced
daylight hours and customer  budgetary  constraints.  Certain  customers tend to
complete budgeted capital  expenditures before the end of the year, and postpone
additional expenditures until the subsequent fiscal period.

     Certain amounts in the 1998 financial statements have been reclassified for
comparability with the 1999 presentation.


     C)   GOODWILL

     The Company's policy is to amortize goodwill over its estimated useful life
of twenty years.  (See discussion on page 13 and 15 of  Management's  Discussion
and Analysis of Financial Condition and Results of Operations.)



                                       7
<PAGE>


     D)   EARNINGS PER SHARE

     Basic  earnings  per  common  share are  computed  by  dividing  net income
available to common stockholders by the weighted average number of common shares
outstanding  for the  period.  Diluted  earnings  per common  share  reflect the
maximum dilution that would have resulted from the exercise of stock options and
warrants and contingently issuable shares. Diluted earnings per common share are
computed by dividing net income by the weighted  average number of common shares
and all dilutive securities.


<TABLE>
<CAPTION>
                                                 For the Three Months Ended
                                     Sept. 30, 1999                       Sept. 30, 1998
                                     --------------                       --------------

                            Income                     Net       Income                      Net
                           per Share     Shares       Income    per Share     Shares        Income
                           ---------     ------       ------    ---------     ------        ------

<S>                         <C>        <C>          <C>          <C>        <C>          <C>
Basic                       $   .24    11,889,000   $2,852,000   $   .20    10,697,000   $2,166,000
Effect of stock options
  and warrants                 (.01)      522,000         --        (.01)      625,000         --

Effect of estimated
  additional shares to be
  issued for USI/Schenck
  purchase                     (.01)      758,000         --        (.01)      746,000         --
                            -------    ----------   ----------   -------    ----------   ----------
Diluted                     $   .22    13,169,000   $2,852,000   $   .18    12,068,000   $2,166,000
                            =======    ==========   ==========   =======    ==========   ==========
</TABLE>

<TABLE>
<CAPTION>
                                                 For the Nine Months Ended
                                    Sept. 30, 1999                        Sept. 30, 1998
                                    --------------                        --------------

                            Income                     Net       Income                      Net
                           per Share     Shares       Income    per Share     Shares        Income
                           ---------     ------       ------    ---------     ------        ------

<S>                         <C>        <C>          <C>          <C>        <C>          <C>
Basic                       $   .43    11,798,000   $5,028,000   $   .24    10,493,000   $2,559,000
Effect of stock options
  and warrants                 (.02)      498,000         --        (.01)      620,000         --

Effect of estimated
  additional shares to
  be issued for USI/
  Schenck purchase             (.02)      649,000         --        --         246,000         --
                            -------    ----------   ----------   -------    ----------   ----------

Diluted                     $   .39    12,935,000   $5,028,000   $   .23    11,359,000   $2,559,000
                            =======    ==========   ==========   =======    ==========   ==========
</TABLE>


     E)   CONTRACT ACCOUNTING

     The  retainage  included  in  accounts  receivable,   representing  amounts
withheld  by  contract  with  respect to Arguss  Communications  Group  accounts
receivable, was $3,702,000 and $3,384,000 at September 30, 1999 and December 31,
1998,  respectively.  The  Company  expects  to  collect  substantially  all the
retainage within one year.

                                                  September 30,     December 31,
                                                       1999             1998
                                                  -------------     ------------

Costs incurred on uncompleted contracts            $80,041,000     $ 41,703,000
Estimated earnings                                  15,487,000        8,242,000
                                                   -----------     ------------
                                                    95,528,000       49,945,000
Less: Billings to date                              79,327,000       47,606,000
                                                   -----------     ------------
                                                   $16,201,000     $  2,339,000
                                                   ===========     ============

Included in accompanying balance sheets
  under the following captions:
    Costs and earnings in excess of billings       $16,201,000     $  3,087,000
    Billings in excess of costs and earnings              --           (748,000)
                                                   -----------     ------------
                                                   $16,201,000     $  2,339,000
                                                   ===========     ============

                                       8
<PAGE>


     F)   ACQUISITIONS

     During the nine months ended  September  30, 1999,  the Company paid former
Schenck  shareholders  an additional  $7.6 million in cash and 777,000 shares of
the Company's common stock in full satisfaction of their additional payments. In
1998, the Company acquired Underground Specialties.  The Underground Specialties
purchase agreement contains provisions for additional payments by the Company to
former  Underground  Specialties  shareholders  to be satisfied by the Company's
common stock and cash, if certain adjusted EBITDA  thresholds for the year ended
July  31,  1999  are  met.  Underground  Specialties  has  exceeded  the  EBITDA
thresholds. The additional payment will aggregate approximately $11.7 million in
cash and 758,000  shares of the  Company's  common  stock.  Additional  payments
earned  under  the  terms of the  agreements  are  recorded  as an  increase  in
goodwill.


     G)   SEGMENT INFORMATION

     The  Company  adopted  SFAS No.  131,  "Disclosures  about  Segments  of an
Enterprise and Related  Information" during the fourth quarter of 1998. SFAS No.
131 establishes  standards for reporting information about operating segments in
interim financial reports issued to stockholders.  It also establishes standards
for related  disclosures  about  products  and services  and  geographic  areas.
Operating  segments  are  defined as  components  of an  enterprise  about which
separate financial  information is available that is evaluated  regularly by the
chief  operating  decision  maker,  or decision making group, in deciding how to
allocate resources and assessing performance.

     The  Company's  three   reportable   segments  are  telecom   construction,
manufacturing  and other.  The  telecom  construction  segment is engaged in the
construction, reconstruction of telecommunications systems, cable television and
data  systems,  including  providing  aerial and  underground  construction  and
splicing  for both fiber  optic and  coaxial  cable to major  telecommunications
customers.  Because the  construction of a telecom system is a fully  integrated
undertaking,  the Company does not capture  individually  each  component of the
construction   functions   performed  for  revenue   reporting   purposes.   The
manufacturing     segment    manufactures    and    sells    highly    advanced,
computer-controlled  equipment used in the SMT circuit  assembly  industry.  The
"Other" column includes the Company's corporate and unallocated expenses.

     The Company's  reportable segments are organized in separate business units
with  different  management,  technology and services.  The respective  segments
account for their respective  businesses using the same accounting policies used
in the  consolidated  financial  statements.  Summarized  financial  information
concerning the Company's  reportable segments net of inter-company  transactions
is shown in the following table.

<TABLE>
<CAPTION>
                                                            Nine Months Ended
                                                            September 30, 1999
                                                            ------------------
                                          Telecom
                                       Construction     Manufacturing        Other             Total
                                       ------------     -------------        -----             -----

<S>                                   <C>               <C>              <C>              <C>
External sales                        $ 130,802,000     $ 12,163,000             --       $ 142,965,000
Cost of sales, excluding
  depreciation                           99,302,000        8,154,000             --         107,456,000
                                      -------------     ------------     ------------     -------------
Gross profit, excluding
  depreciation                           31,500,000        4,009,000             --          35,509,000
Operating expenses,
  excluding depreciation                  8,850,000        3,140,000             --          11,990,000
Goodwill amortization                     3,212,000             --               --           3,212,000
Depreciation                              6,059,000          159,000             --           6,218,000
Engineering and development                    --          1,006,000             --           1,006,000

Interest and other income                   380,000             --               --             380,000
Interest expense                         (2,997,000)        (163,000)          (8,000)       (3,168,000)
                                      -------------     ------------     ------------     -------------
Pretax income (loss)                  $  10,762,000     ($   459,000)    ($     8,000)    $  10,295,000
                                      =============     ------------     ------------     =============

Capital expenditures                  $  11,095,000     $    129,000             --       $  11,224,000
                                      =============     ============     ============     =============
Property, plant and equipment, net    $  35,643,000     $  1,279,000     $     23,000     $  36,945,000
                                      =============     ============     ============     =============

Total assets                          $ 185,699,000     $  9,113,000     $  5,718,000     $ 200,530,000
                                      =============     ============     ============     =============

Total liabilities                     $  98,225,000     $  6,046,000     $ 10,872,000     $ 115,143,000
                                      =============     ============     ============     =============
</TABLE>


                                       9
<PAGE>


<TABLE>
<CAPTION>
                                                            Nine Months Ended
                                                            September 30, 1998
                                                            ------------------
                                          Telecom
                                       Construction     Manufacturing        Other             Total
                                       ------------     -------------        -----             -----

<S>                                   <C>               <C>              <C>              <C>
External sales                        $  91,508,000     $ 13,233,000             --       $ 104,741,000
Cost of sales, excluding
   depreciation                          69,737,000        8,841,000             --          78,578,000
                                      -------------     ------------     ------------     -------------
Gross profit, excluding
   depreciation                          21,771,000        4,392,000             --          26,163,000
Operating expenses,
   excluding depreciation                 5,858,000        3,542,000             --           9,400,000
Goodwill amortization                     1,992,000             --               --           1,992,000
Non cash stock compensation               1,806,000             --             41,000         1,847,000
Depreciation                              4,299,000          164,000             --           4,463,000
Engineering and development                    --            905,000             --             905,000

Interest and other income                   272,000            9,000           31,000           312,000
Interest expense                         (2,127,000)        (147,000)          (1,000)       (2,275,000)
                                      -------------     ------------     ------------     -------------
Pretax income (loss)                  $   5,961,000     ($   357,000)    ($    11,000)    $   5,593,000
                                      =============     ============     ============     =============

Capital expenditures                  $  10,943,000     $    106,000             --       $  11,049,000
                                      =============     ============     ============     =============
Property, plant and equipment, net    $  25,885,000     $  1,318,000     $     31,000     $  27,234,000
                                      =============     ============     ============     =============

Total assets                          $ 127,853,000     $  9,155,000     $    842,000     $ 137,850,000
                                      =============     ============     ============     =============

Total liabilities                     $  66,565,000     $  4,149,000     $  3,939,000     $  74,653,000
                                      =============     ============     ============     =============
</TABLE>


<TABLE>
<CAPTION>
                                                            Three Months Ended
                                                            September 30, 1999
                                                            ------------------
                                          Telecom
                                       Construction     Manufacturing        Other             Total
                                       ------------     -------------        -----             -----

<S>                                   <C>               <C>              <C>              <C>
External sales                        $  49,139,000     $  4,212,000             --       $  53,351,000
Cost of sales, excluding
   depreciation                          36,784,000        2,858,000             --          39,642,000
                                      -------------     ------------     ------------     -------------
Gross profit, excluding
   depreciation                          12,355,000        1,354,000            1,000        13,709,000
Operating expenses,
   excluding depreciation                 2,833,000        1,070,000             --           3,904,000
Goodwill amortization                     1,208,000             --               --           1,208,000
Depreciation                              2,142,000           53,000             --           2,195,000
Engineering and development                    --            322,000             --             322,000

Interest and other income                   186,000             --               --             186,000
Interest expense                         (1,050,000)         (63,000)            --          (1,113,000)
                                      -------------     ------------     ------------     -------------
Pretax income (loss)                  $   5,308,000     ($   154,000)    ($     1,000)    $   5,153,000
                                      =============     ------------     ============     =============

Capital expenditures                  $   2,804,000     $     18,000             --       $   2,822,000
                                      =============     ============     ============     =============
Property, plant and equipment, net    $  35,643,000     $  1,279,000     $     23,000     $  36,945,000
                                      =============     ============     ============     =============

Total assets                          $ 185,699,000     $  9,113,000     $  5,718,000     $ 200,530,000
                                      =============     ============     ============     =============

Total liabilities                     $  98,225,000     $  6,046,000     $ 10,872,000     $ 115,143,000
                                      =============     ============     ============     =============
</TABLE>


                                       10
<PAGE>


<TABLE>
<CAPTION>
                                                            Three Months Ended
                                                            September 30, 1998
                                                            ------------------
                                          Telecom
                                       Construction     Manufacturing        Other             Total
                                       ------------     -------------        -----             -----

<S>                                   <C>               <C>              <C>              <C>
External sales                        $  42,452,000     $  3,456,000             --       $  45,908,000
Cost of sales, excluding
   depreciation                          32,219,000        2,324,000             --          34,543,000
                                      -------------     ------------     ------------     -------------
Gross profit, excluding
   depreciation                          10,233,000        1,132,000             --          11,365,000
Operating expenses,
   excluding depreciation                 2,090,000        1,055,000             --           3,145,000
Goodwill amortization                       687,000             --               --             687,000
Non cash stock compensation                 742,000             --              2,000           744,000
Depreciation                              1,613,000           55,000             --           1,668,000
Engineering and development                    --            362,000             --             362,000

Interest and other income                   114,000            8,000           14,000           136,000
Interest expense                           (772,000)         (54,000)          (1,000)         (827,000)
                                      -------------     ------------     ------------     -------------
Pretax income (loss)                  $   4,443,000     $   (386,000)    $     11,000     $   4,068,000
                                      =============     ============     ============     =============

Capital expenditures                  $   3,523,000     $     64,000             --       $   3,587,000
                                      =============     ============     ============     =============
Property, plant and equipment, net    $  25,885,000     $  1,318,000     $     31,000     $  27,234,000
                                      =============     ============     ============     =============

Total assets                          $ 127,853,000     $  9,155,000     $    842,000     $ 137,850,000
                                      =============     ============     ============     =============

Total liabilities                     $  66,565,000     $  4,149,000     $  3,939,000     $  74,653,000
                                      =============     ============     ============     =============
</TABLE>


     H)   BANK FINANCING

     In  March  1999,  the  Company  increased  its  availability  under  credit
facilities with banks.  The Company expanded the credit facility to $100 million
from approximately $50 million,  and increased the number of banks participating
to six money center and regional banks. The Company pledged the capital stock of
its wholly owned subsidiaries and the majority of the Company's assets to secure
the credit  facility.  The Company intends to use the credit facility to provide
working capital to finance  acquisitions  and the purchase of capital assets and
for other corporate  purposes.  The credit facility has a $70 million  revolving
credit  feature,  as well as a $30 million  amortizing  five-year term facility.
Amounts  borrowed under the credit facility will bear interest as a relationship
to the  London  Interbank  Offered  Rate  ("LIBOR"),  plus  1.25%  to  2.25%  as
determined  by the ratio of the  Company's  total  funded  debt to  EBITDA.  The
Company incurs commitment fees of .25% to .50% as determined by the ratio of the
Company's total funded debt to EBITDA on any unused borrowing capacity under the
credit facility.

     In the  ordinary  course of  business,  the  Company is exposed to floating
interest rate risk. In March 1999,  the Company  terminated  interest rate swaps
entered into as a hedge  against  variable  term loan  interest  rate risk.  The
aggregate  loss of  approximately  $330,000 on  termination of the interest rate
swaps is being  amortized over the remaining life of the related term loan which
was hedged.



                                       11
<PAGE>


     To hedge the  variable  term loan  interest  rate risk for $30  million  in
notional amount,  five-year,  term financing  facility,  the Company has entered
into an interest  rate swap pursuant to which it pays fixed  interest  rates and
receives  variable  interest rates on the same notional amount.  During the nine
months ended  September 30, 1999, the Company's  payment under the interest rate
swap aggregated  approximately  $70,000. The Company had no receipts pursuant to
the interest rate swap.

     I)   RELATED-PARTY TRANSACTIONS

     During the nine months  ended  September  30,  1999,  the Company  acquired
offices and equipment  maintenance  facilities  from the former owners of Can-Am
and Schenck, who are significant shareholders in Arguss, as well as employees of
Arguss  Communications  Group. The aggregate purchase price was $2,608,000,  and
was negotiated based on independent, third party appraisals.




                                       12
<PAGE>


                              ARGUSS HOLDINGS, INC.

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

RESULTS OF OPERATIONS

     Prior to May 1997,  Arguss  Holdings,  Inc. (the  "Company")  operated as a
single entity under the name Conceptronic, Inc. On May 9, 1997, the shareholders
of the Company  approved a plan providing for the internal  restructuring of the
Company  whereby the Company became a holding  company and its operating  assets
were held by wholly owned operating subsidiaries.  Accordingly,  on May 9, 1997,
the Company  transferred  substantially all of its Conceptronic,  Inc. operating
assets to a newly  formed,  wholly  owned  subsidiary  of the  Company,  and the
Company changed its name to "Arguss Holdings,  Inc." The subsidiary then adopted
the name "Conceptronic, Inc." ("Conceptronic"). The Company's other wholly owned
operating  subsidiary is Arguss  Communications  Group,  formerly White Mountain
Cable  Construction  Corp.  Arguss  Communications  Group  operates  through its
divisions - White Mountain, Can-Am, TCS, Schenck, and Underground Specialties.

     The Company conducts its operations through its wholly owned  subsidiaries,
Arguss  Communications  Group and Conceptronic.  Arguss  Communications Group is
engaged in the construction,  reconstruction,  maintenance, repair and expansion
of  telecommunications  systems,  cable  television and data systems,  including
providing  aerial and underground  construction and splicing of both fiber optic
and  coaxial   cable  to  major   telecommunications   customers.   Conceptronic
manufactures  and sells highly advanced,  computer-controlled  equipment used in
the Surface Mount Technology circuit assembly industry.

     During the quarter  ended  September 30, 1999,  plans to sell  Conceptronic
were terminated.  The Company's  decision not to sell the division was based, in
part, on improved order flow, completion of a new oven design, and the hiring of
a new  President.  Consequently,  Conceptronic  was  reinstated  as a continuing
operation.  Because the Company  believes  there has been no  impairment  on the
carrying  value of the net assets of  Conceptronic,  the  estimated  loss on the
disposal of  discontinued  operations was reversed.  The reversal of the accrued
loss on the disposal of  discontinued  operations  during the three months ended
September  30, 1999 was $182,000,  or $.01 per share.  Segment  information  for
Conceptronic is presented in Note G.

     The Company uses an amortization period of twenty years with respect to the
amortization of its goodwill.  Management  believes that the Company's  goodwill
amortization  policy results in a better measure of financial  performance  than
the amortization period of forty years used by its competitors.  Had the Company
adopted a forty year useful life for  amortization  of goodwill,  its net income
for the three  months  and nine  months  ended  September  30,  1999  would have
increased by $604,000 and $1,606,000,  respectively.  Diluted earnings per share
would have  increased  by $.05 per share and $.12 per share for the three months
and nine months ended September 30, 1999. Consequently, net income for the three
months and nine months ended  September 30, 1999 would have been  $3,456,000 and
$6,634,000, respectively and diluted earnings per share would have been $.26 per
share and $.51 per share for the three  months and nine months  ended  September
30, 1999.

THREE MONTHS ENDED SEPTEMBER 30, 1999, COMPARED TO THREE MONTHS ENDED
SEPTEMBER 30, 1998

     The Company had consolidated earnings before interest,  taxes, depreciation
and amortization adjusted for non cash stock compensation (EBITDA) of $9,851,000
for the three months ended  September 30, 1999,  compared to $7,992,000  for the
same period one year ago. For the three months ended September 30, 1999, EBITDA,
as a percentage of consolidated net sales (EBITDA margin),  was 18.5%,  compared
to 17.4% for the  comparable  period in 1998.  Arguss  Communications  Group had
EBITDA of $9,600,000 for the three months ended September 30, 1999,  compared to
$8,257,000 for the same period in 1999. Arguss  Communications Group achieved an
EBITDA  margin of 19.5% for the three months ended  September 30, 1999 and 1998.
Arguss Communications Group's strong EBITDA margin performance was combined with
continued  strong  revenue growth and improved gross margin results as discussed
below.

     The Company had  consolidated net income of $2,852,000 for the three months
ended  September 30, 1999,  compared to net income of  $2,166,000  for the three
months ended September 30, 1998. The Company's  results were favorably  impacted
by the maturation of projects started during 1998 in Orlando,  FL, Portland,  OR
and Denver CO and the positive operating results of White Mountain.



                                       13
<PAGE>


     Consolidated  net sales for the three months ended  September 30, 1999 were
approximately  $53,351,000,  compared to approximately $45,908,000 for the three
months  ended  September  30,  1998,  an increase  of 16% due,  in part,  to the
acquisition of Underground  Specialties.  Operations owned for at least one year
had a net  sales  increase  of  $4,794,000  or 10% for the  three  months  ended
September 30, 1999.

     Consolidated gross profit margin, excluding depreciation,  was 26% of sales
for the three months  ended  September  30, 1999,  compared to 25% for the three
months ended  September 30, 1998. The improvement in margins is due primarily to
Can-Am,  whose  Portland,  OR project and other  regional TCI projects  achieved
greater sales volume and margins for the three months ended  September 30, 1999.
The  improvements  in  margins  was  offset,  in  part,  by  reduced  levels  of
construction activity in Alaska,  customer delays in the roll-out of projects in
San Jose and the  impact of lower  margins  on a certain  long-haul  project  in
Oregon.

     Consolidated  selling,  general and  administrative  expenses for the three
months ended September 30, 1999 were  $3,904,000 or 7.3% of net sales,  compared
to  $3,889,000  or 8.5% of net sales for the three  months ended  September  30,
1998.  Arguss  Communications  Group  experienced  reduced selling,  general and
administrative  expenses  as a  percentage  of net sales  because  for the three
months  ended  September  30, 1998 the  Company  had  $742,000 of non cash stock
compensation,  compared to none in the  comparable  period ended  September  30,
1999.

     Depreciation  expense  increased to  $2,195,000  for the three months ended
September 30, 1999,  compared to $1,668,000 for the three months ended September
30, 1998 due  primarily to Arguss  Communications  Group which made  significant
equipment  acquisitions  during  calendar year 1998,  and during the nine months
ended September 30, 1999. The equipment is depreciated over sixty months.

     Goodwill amortization, which is calculated using a twenty-year amortization
period,  increased to $1,208,000  from $687,000 from the  comparable  period one
year ago due to  Schenck,  whose  former  shareholders  realized  an  additional
payment  of  $18,696,000  in cash  and  stock  in  full  satisfaction  of  their
additional  payment.  The  additional  payment earned under the terms of Schenck
purchase  agreement  was  recorded  as an increase in  goodwill.  The  increased
goodwill is amortized  over the  remaining  nineteen-year  amortization  period,
which increased  goodwill  amortization  during the three months ended September
30, 1999 by  $246,000.  The Company  also  recorded  $22,650,000  in  additional
goodwill  during  the three  months  ended  September  30,  1999  related to the
additional  payment  due  former  Underground  Specialties  shareholders.   This
increased  goodwill is amortized over the remaining  nineteen-year  amortization
period.

     Interest  expense  for the  three  months  ended  September  30,  1999  was
$1,113,000,  compared to $827,000 for the comparable  period in 1998. The Arguss
Communications  Group  interest  expense  increased  for the three  months ended
September 30, 1999,  due to the purchase of  Underground  Specialties  which was
partially  financed through bank lines of credit,  due to the additional payment
of $7.6  million to former  Schenck  shareholders  and due to  increased  use of
financing  lines  for  the  capital  assets   purchases  in  support  of  Arguss
Communications  Group's revenue growth.  (See discussion of expanded bank credit
facilities in LIQUIDITY AND CAPITAL RESOURCES.)

     Income tax expense was $2,483,000 for the three months ended  September 30,
1999,  compared to  $1,902,000  in income tax expense for the three months ended
September 30, 1998. The effective  income tax rate was 48% and 47% for the three
months ended September 30, 1999 and 1998,  respectively.  Goodwill amortization,
which is nondeductible for income tax purposes, impacts the effective income tax
rate  creating an unusual  relationship  of the expected  effective  tax rate to
pretax income or loss.  During the three months ended  September  30, 1999,  the
Company  utilized a 39% effective  income tax rate prior to giving effect to the
impact of nondeductible  goodwill  amortization on pretax income,  compared to a
40% estimated tax rate in the comparable period of one year ago.

NINE MONTHS ENDED SEPTEMBER 30, 1999, COMPARED TO NINE MONTHS ENDED
SEPTEMBER 30, 1998

     The Company had EBITDA of $22,893,000  for the nine months ended  September
30,  1999,  compared to  $16,170,000  for the same period in 1998.  For the nine
months ended  September  30, 1999 and 1998,  EBITDA  margin was 16.0% and 15.4%,
respectively.  Arguss  Communications  Group increased its EBITDA to $23,103,000
for the nine months ended September 30, 1999 from $16,185,000 in the same period
one year ago. Arguss Communications Group's EBITDA margin was 17.7% for the nine
months ended September 30, 1999 and 1998,  respectively.  Arguss  Communications
Group's  strong EBITDA margin  performance  was combined with  continued  strong
revenue growth and consistent gross margin results as discussed below.



                                       14
<PAGE>


     The Company had consolidated net income of approximately $5,028,000 for the
nine months ended  September 30, 1999,  compared to net income of $2,559,000 for
the nine months ended  September 30, 1998. The Company's  results were favorably
impacted by the  maturation  of  projects  started  during 1998 in Orlando,  FL,
Portland,  OR  and  Denver,  CO  and  positive  operating  results  achieved  by
Underground  Specialties,  owned for the entire period in 1999, which offset the
decline in Alaska construction activity.

     Consolidated  net sales for the nine months ended  September  30, 1999 were
approximately  $142,965,000,  compared  to  approximately  $104,741,000  for the
comparable  period in 1998, an increase of 36% due primarily to the  acquisition
of Underground  Specialties,  which  accounted for $29,511,000 or 21% of the net
sales for the nine months  ended  September  30, 1998.  Operations  owned for at
least  one year had a net  sales  increase  of  $15,844,000  or 15% for the nine
months ended September 30, 1999.

     Consolidated gross profit margin, excluding depreciation,  was 25% of sales
for the nine  months  ended  September  30, 1999 and 1998.  Improved  margins at
Arguss  Communications  Group from its long-haul  operations and  aforementioned
maturing  projects  were  offset by lower  levels of  construction  activity  in
Alaska.

     Consolidated  selling,  general and  administrative  expenses  for the nine
months ended September 30, 1999 were $11,990,000 or 8.4% of net sales,  compared
to  $11,247,000  or 10.7% of net sales for the  comparable  period in 1998.  The
Company  experienced reduced selling,  general and administrative  expenses as a
percentage  of net sales  because in the nine months ended  September  30, 1998,
Arguss  Communications  Group had  $1,847,000  in non cash  stock  compensation,
compared  to  none  for  the  nine  months  ended  September  30,  1999.  Arguss
Communications  Group  has  maintained  control  of  administrative  costs  as a
percentage of consolidated net sales as sales volumes have increased.

     Depreciation  expense  increased  to  $6,218,000  for the nine months ended
September 30, 1999,  compared to $4,463,000 for the nine months ended  September
30, 1998 due primarily to Arguss  Communications  Group,  which made significant
equipment  acquisitions during the calendar year 1998 and during the nine months
ended September 30, 1999. The capital assets are depreciated over sixty months.

     Goodwill amortization, which is calculated using a twenty-year amortization
period,  increased to $3,212,000  from  $1,992,000 in the comparable  period one
year ago due to the  acquisition  of  Underground  Specialties,  the  additional
payment  to  Schenck,  and the  additional  payment  due to  former  Underground
Specialties shareholders.

     Interest  expense  for  the  nine  months  ended  September  30,  1999  was
$3,168,000,  compared to $2,275,000 for the comparable period in 1998.  Interest
expense  increased due to the  acquisition  of  Underground  Specialties,  whose
purchase was partially  financed  through bank financing,  due to the additional
payment of $7.6  million to former  Schenck  shareholders,  and due to equipment
financing lines for the above expanded capital assets acquisition program.  (See
discussion  of  expanded  bank  credit   facilities  in  LIQUIDITY  AND  CAPITAL
RESOURCES.)

     Income tax  expense  increased  to  $5,267,000  for the nine  months  ended
September 30, 1999 from  $3,034,000 in the comparable  period  one-year ago. The
effective  income tax rate was 51% and 54% for the nine months  ended  September
30, 1999 and 1998, respectively.  Goodwill amortization, which is non-deductible
for income tax  purposes,  impacts  the  effective  income tax rate  creating an
unusual  relationship  of the expected  effective  tax rate to pretax  income or
loss.  During the nine months ended  September 30, 1999, the Company  utilized a
39%  effective  income  tax  rate  prior  to  giving  effect  to the  impact  of
nondeductible  goodwill  amortization  on  pretax  income,  compared  to  a  40%
effective tax rate in the comparable period one year ago.

LIQUIDITY AND CAPITAL RESOURCES

     Effective August 1, 1998, the Company acquired Underground Specialties. The
Underground  Specialties  purchase agreement contains  provisions for additional
payments by the Company to former  Underground  Specialties  shareholders  to be
satisfied by the  Company's  common stock and cash, if certain  adjusted  EBITDA
thresholds for the year ended July 31, 1999 are met. Underground Specialties has
exceeded its EBITDA thresholds at July 31, 1999. Former Underground  Specialties
shareholders will receive an additional $11.7 million in cash and 758,000 shares
of the Company's stock in full  satisfaction of their  additional  payment.  The
Company  accrued  $11,745,000  as a liability at September 30, 1999 for the cash
portion payable.  The Company has recorded  $10,909,000 of common stock issuable
at September  30, 1999 to reflect the 758,000  shares which will be issued.  The
cash portion will be paid in November of 1999 and funded by the  revolving  line
of credit.  Additional  payments  earned under the terms of the  agreements  are
recorded as an increase in goodwill.



                                       15
<PAGE>


     During  the  nine  months  ended   September  30,  1999,   former   Schenck
shareholders  received an additional  $7.6 million in cash and 777,000 shares of
the Company's common stock in full  satisfaction of their  additional  payments.
The Company funded the payment using its lines of credit.

     Consolidated net cash provided by operating  activities for the nine months
ended September 30, 1999 was $9,279,000, compared to a use of cash of $1,498,000
for the nine months ended  September 30, 1998.  The increase in cash provided by
operating  activities is due primarily to the increase in net income, as well as
a reduction in the rate of the growth in contract  receivables  when compared to
the same period one year ago. (Contract  receivables include accounts receivable
and costs and  earnings  in excess  of  billings).  Net cash used for  investing
activities  for the nine  months  ended  September  30,  1999  was  $21,345,000,
compared  to  $28,060,000  in the  comparable  period of 1998.  The  decrease in
investing  activities is primarily  due to the  acquisition  of  Longnecker  for
$1,835,000 in cash in 1999,  compared with the  acquisitions of Can-Am,  Schenck
and Underground Specialties for $17,441,000 in cash during the nine months ended
September 30, 1998. The Company  expended  $7,604,000 in 1999 for the additional
payment due to former Schenck shareholders. Net cash flows provided by financing
activities  was  $13,925,000  for the nine  months  ended  September  30,  1999,
compared to net cash flows provided by financing  activities of $29,936,000  for
the  same  period  in  1998.  The  decrease  in net cash  flows  from  financing
activities  reflects  the  impact of the  acquisition  of  Can-Am,  Schenck  and
Underground  Specialties  in 1998 whose cash amount  exceeded the aggregate cash
expended to purchase  Longnecker,  and to make the additional  payment to former
Schenck shareholders in 1999.

     In  March  1999  the  Company  increased  its  availability   under  credit
facilities with banks.  The Company expanded the credit facility to $100 million
from approximately $50 million,  and increased the number of banks participating
to six money center and regional banks. The Company pledged the capital stock of
its wholly owned subsidiaries and the majority of the Company's assets to secure
the credit  facility.  The Company will  utilize the credit  facility to provide
working capital, to finance  acquisitions,  to purchase  equipment,  and to fund
other  corporate  activities.  The credit  facility has a $70 million  revolving
credit  line,  as well as a $30  million  decreasing  five-year  term  financing
facility.  Amounts  borrowed  under the credit  facility will bear interest as a
relationship to the London Interbank Offered Rate ("LIBOR"), plus 1.25% to 2.25%
as  determined  by the  Company's  ratio of funded  debt to EBITDA.  The Company
incurs  commitment  fees  of .25% to .50%  as  determined  by the  ratio  of the
Company's total funded debt to EBITDA on any unused borrowing capacity under the
credit facility.

     The Company had $70 million in  revolving  lines of credit with  commercial
banks of which  $27,000,000  was drawn down as of September 30, 1999 to fund the
additional payment to former Schenck  shareholders,  the purchase of Longnecker,
capital  equipment  purchases  and working  capital.  In the ordinary  course of
business,  the Company is exposed to variable  interest  rate risk. To hedge the
variable  term loan  interest  rate risk for $30  million  in  notional  amount,
five-year  term,  financing  facility,  the Company has entered into an interest
rate  swap  pursuant  to which it pays a fixed  interest  rate  and  receives  a
variable interest rate on the same notional amount. During the nine months ended
September 30, 1999, the Company's  payment under  interest rate swap  aggregated
approximately $70,000. The Company had no receipts pursuant to the interest rate
swap. In March 1999, the Company terminated  interest rate swaps entered into as
a hedge against  variable-term  loan interest rate risk.  The aggregate  loss of
approximately  $330,000  on  termination  of the  interest  rate  swaps is being
amortized over the remaining life of the related term loan which was hedged.

     The  Company  continues  to  actively  pursue  acquisitions  in the telecom
construction and other  industries.  In the event that one or more  satisfactory
acquisition  candidates  are  identified,  the  Company  may seek to expand  its
existing credit facilities or issue additional equity or subordinated debt.

     The Company believes it has sufficient cash flow from  operations,  cash on
hand and availability under its credit line to meet its liquidity needs.

     The  Company's  telecom  construction   operations  are  expected  to  have
seasonally  weaker results in the first and fourth quarters of the year, and may
produce stronger  results in the second and third quarters.  This seasonality is
primarily due to the effect of winter weather on outside plant activities in the
northern  areas  served  by  Arguss  Communications  Group,  as well as  reduced
daylight hours and customer  budgetary  constraints.  Certain  customers tend to
complete budgeted capital  expenditures before the end of the year, and are slow
to return to expected  production  levels in the first quarter of the subsequent
fiscal period.



                                       16
<PAGE>


YEAR 2000 DATE CONVERSION

     The Year 2000 issue relates to the inability of certain  computer  software
programs to properly recognize and process  date-sensitive  information relative
to the year 2000 and beyond. Without corrective measures, this issue could cause
computer  applications  to fail or to create  erroneous  results.  Incomplete or
untimely resolution of the Year 2000 issue by the Company or by its key vendors,
customers,  suppliers or by other third parties could have a materially  adverse
impact on the  Company's  business,  operations  or  financial  condition in the
future.

     During 1998,  Arguss  Communications  Group  commenced the upgrading of its
business  information  systems through common  integrated  computer and software
systems  throughout  Arguss   Communications  Group.  As  a  by-product  of  the
implementation  of  the  new  integrated   business  reporting  system,   Arguss
Communications  Group  remediated Year 2000 compliance  issues at certain of its
divisions.  All Arguss  Communications  Group divisions are operating on the new
integrated business system as of September 30, 1999.

     In  conjunction  with its review of its Year 2000  compliance  issues,  the
Company has  conducted  an inventory of its  information  technology  ("IT") and
manufacturing  and  telecom  construction  systems  ("non-IT"),  as  well as its
telecommunications  systems.  Arguss Communications Group has addressed its Year
2000 compliance issue for IT, non-IT and  telecommunications  systems. The total
cost with respect to systems and other  modifications  to Company IT, non-IT and
telecommunications  systems did not exceed $300,000, more than one-half of which
was  expended in 1998.  The  Company  expended  less than  $100,000 on Year 2000
remediation during the nine months ended September 30, 1999.

     The Company has also  identified  and  prioritized  critical  suppliers and
customers  and  communicated  with  them  about  their  plans  and  progress  in
addressing  the Year 2000  problem.  Detailed  evaluations  of the most critical
third parties have been completed. Contingency plans were developed in the first
quarter of 1999 in response to the detailed evaluations.

     The Company has completed all phases of its Year 2000 Project.  The Company
currently  believes  that the  Year  2000  issue  should  not  pose  significant
operational problems to the Company.  There can be no assurance,  however,  that
the  systems  of  other  parties  upon  which  the  Company's  business  relies,
including, but not limited to, the Company's key vendors,  customers,  suppliers
and other third parties will be converted on a timely basis.  If the systems and
applications  of key third  parties  are  materially  impacted  by the Year 2000
issue, the Company could lose certain of its abilities to efficiently  engage in
normal  business  activities  which could have a material  adverse effect on the
Company's business, financial condition or results of operations.  Although some
business  disruption in the Company's business may possibly occur as a result of
Year 2000  failures by third  parties,  the Company  does not believe  that such
disruption would have a materially adverse effect on its operations. Contingency
plans were  developed in the first  quarter of 1999 in response to the Company's
evaluation of Year 2000 business exposures.  The Company believes that, with the
implementation of new business systems and contingency  planning with respect to
key  vendors  and  customers,  as  well  as the  expansion  of its  bank  credit
facilities,  the  possibility of significant  business  interruptions  of normal
operations should be reduced.

     The Company  believes that the most  reasonably  likely worst case scenario
which could occur with respect to Year 2000 is a delay in receiving  payments on
accounts  receivable  from  customers.  In March 1999, the Company  expanded its
available  liquidity  through  expanded bank financing  facilities.  The Company
believes that such expanded  financing  should  mitigate the cash flow impact of
delays in collections of amounts due from customers.

     In addition to its  internal  systems and  external  supplier  and customer
relationships,  the Company has  exposure  to Year 2000  compliance  issues with
respect to potential acquisitions.  The Company includes Year 2000 compliance in
its  evaluation of  acquisition  candidates,  as well as in its due diligence in
progress.  At September 30, 1999,  the Company had one  acquisition in progress.
Upon  preliminary  review,  the Company  does not expect  significant  Year 2000
compliance problems with respect to this acquisition.

FORWARD LOOKING STATEMENTS

     Statements made in the quarterly  report that are not historical or current
facts  are  "forward-looking  statements"  made  pursuant  to  the  safe  harbor
provisions of the Private  Securities  Litigation Reform Act of 1995.  Investors
are  cautioned   that  actual  results  may  differ   substantially   from  such
forward-looking statements. Forward looking statements may be subject to certain
risks and uncertainties,  including - but not limited to - continued  acceptance
of  the  Company's  products  and  services  in the  marketplace,  uncertainties
surrounding  new  acquisitions,  floating rate debt,  risks of the  construction
industry,  including  weather and an  inability  to plan and  schedule  activity
levels,  doing business overseas and risks inherent in concentration of business
in certain  customers.  All of these risks are detailed from time to time in the
Company's filings with the Securities and Exchange Commission.  Accordingly, the
actual results of the Company could differ materially from such  forward-looking
statements.




                                       17
<PAGE>


ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     In the ordinary course of business, the Company is exposed to interest rate
risk. To reduce  variable term loan interest rate risk,  the Company has entered
into an interest rate swap in the same notional  amount as its related term loan
debt  with  the same  interest  rate  relationship  base to LIBOR as that of the
Company's  floating rate debt,  and for the same term as the variable rate debt.
At September 30, 1999,  the Company's  variable rate term loan of $26,500,000 in
notional  amount  and  maturing  in more  than 180 days was  hedged  through  an
interest rate swap pursuant to which Arguss pays a weighted  fixed interest rate
of 5.78%. The Company continues to be exposed to variable-term loan interest for
the bank's  applicable  margins ranging from 1.25% to 2.25% as determined by the
ratio of the Company's total funded debt to EBITDA.

     Interest  rate  swaps  are  entered  into as a  hedge  of  underlying  debt
instruments  to  effectively  change the  characteristics  of the interest  rate
without  actually  changing the debt instrument.  For fixed rate debt,  interest
rate  changes  affect the fair value,  but do not impact  earnings or cash flow.
Conversely,  for floating  rate debt,  interest  rate  changes  generally do not
affect the fair market value, but do impact future earnings and cash flow. A one
percentage  point  decrease in interest  rates would  decrease the fair value of
interest rate swaps by approximately $270,000. The earnings and cash flow impact
for the next year resulting from a one percentage point increase  interest rates
would be neutral  because of the cash flow received  from the swaps.  All of the
principal of the variable  rate debt subject to the interest  rate swap would be
repaid  over the next  five  years  thereby  diminishing  the  impact  of market
valuations on hedges.







                                       18
<PAGE>




                              ARGUSS HOLDINGS, INC.

                                     PART II

                                Other Information



Items 1, 2, 3, 4, 5 and 6: Not Applicable.

     (a)  27   Financial Data Schedule

     (b)  Reports on Form 8-K

     None.





                                   SIGNATURES


     Pursuant to the  requirements  of the Securities  Exchange Act of 1934, the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.

                                      Arguss Holdings, Inc.


November 9, 1999                      By:  /s/ Rainer H. Bosselmann
                                           -----------------------------------
                                           Rainer H. Bosselmann
                                           Chief Executive Officer



November 9, 1999                      By:  /s/ Arthur F. Trudel
                                           -----------------------------------
                                           Arthur F. Trudel
                                           Principal Financial Officer and
                                           Principal Accounting Officer


                                       19